Fiscal Incentives to Tourism Economic Zone

Operators
and
Registered
Tourism
Enterprises
Within
the
TEZ
(under
TIEZA/Tourism Infrastructure and Enterprise
Zone Authority)
1. Income Tax Holiday
a.
New enterprises in Greenfield

and Brownfield Tourism Zones

shall, from the start

of business operations, be exempt from tax on income for a
period of six (6) years.
b.
The income tax holiday may be extended if the enterprise
undertakes a substantial
expansion or upgrade of its facilities
prior to the expiration of the first six (6) years.
c. Existing enterprise in Brownfield Tourism Zone shall be entitled to
avail of a non-extendible income tax holiday if it undertakes an
extensive expansion or upgrade of facilities. The cost of such
expansion or upgrade in relation to the original investment shall
be considered in the grant of said incentive.
d. These enterprises shall be allowed to carryover as a deduction
from the gross income for the next six (6) consecutive years
immediately following the year of the loss, their net operating
losses for any taxable year immediately preceeding the current
taxable year which had not been previously offset as deduction
from gross income. Only such losses as have been incurred after
registration may be carried over.

2. Gross Income Taxation

a.

Except real estate taxes and such fees as may be imposed by the
TIEZA, a new enterprise shall be exempt from payment of all
national and local taxes and license fees, imposts and
assessments.
b.
In lieu thereof, it shall pay a tax of five percent (5) on its gross
income earned which shall be distributed as follows:
One- third (1/3) to be proportionately allocated among affected
cities or
municipalities
One- third (1/3) to the national government; and
One- third (1/3) to TIEZA

1.

Tax and Duty-Free importation of:

1.1. Capital Investment and Equipment

Registered enterprises shall be entitled to an exemption of one
hundred percent (100%) of all taxes and customs duties on
importation of capital investment and equipment provided that
these are directly and actually needed and will be used
exclusively by the enterprises in its registered activity.
1.2.

Transportation Equipment and Spare Parts

Importation of transportation equipment and the accompanying
spare parts of new and expanding registered enterprises shall
be exempt from customs duties and national taxes, provided
that:
a.
They are not manufactured domestically in sufficient
quantity, of comparable
quality and at reasonable prices;
b.
They are reasonably needed; and
c.
Shall be used exclusively by an accredited tourism
enterprise.

3.3. Goods and Services

a.
Importation of goods actually consumed in the course of
services actually rendered by or through registered
enterprises within a TEZ shall enjoy one hundred percent
(100%) exemption from all taxes and customs duties:
Provided, however, That no goods shall be imported for the
purpose of operating a wholesale or retail establishment in
competition with the Duty Free Philippines Corporation
(DFPC); and
b.
A tax credit equivalent to all national internal revenue
taxes paid on all locally-sourced goods and services
directly or indirectly used by the registered enterprise for
services actually rendered within the TEZ.

2.

Social Responsibility Incentive

TEZ Operators and Registered Tourism Enterprises shall be
entitled to a tax deduction equivalent to fifty percent (50%) of
the cost of environmental protection or cultural heritage,
preservation activities, sustainable livelihood programs for local
communities, and other similar activities as approved by the
TIEZA Board.

II. Non-fiscal Incentives Available

Operators
and
Registered
Enterprises
1.

to TEZ
Tourism

Employment of Foreign Nationals

A registered enterprise may employ foreign nationals in
executive, supervisory, technical, or advisory position for such
reasonable periods and under such terms as may be provided by
the TIEZA Board.

2.

Special Investors Resident Visa

A foreign national who invests at least US$200,00.xx in a TEZ
and/or a Registered Tourism Enterprise, his dependents, spouse
and unmarried children under 18 yrs. of age, shall be entitled to
a special investors resident visa enabling the foreign national to
reside in the Philippines while his or her investment subsists.tives
for Retirement Economic Zone Developer / Operator

1.

Subject to regulations to be issued by the Bureau of

Immigration, the TIEZA shall issue working visas renewable every
2 years to foreign personnel and other aliens possessing highlytechnical skills which no Filipino within the TEZ possesses, after
they have secured Alien Employment Permits (AEP) from the
Department of Labor and Employment (DOLE).

SOURCE : TIEZA Website